Harbours (Amendment) Bill 2008: Second Stage.

Wednesday, 8 October 2008

Seanad Eireann Debate
Vol. 191 No. 5

Page of 10

Question proposed: “That the Bill be now read a Second Time.”

Minister of State at the Department of Transport (Deputy Noel Ahern):I am pleased to introduce the Harbours (Amendment) Bill 2008 for the consideration of the House. The primary purpose of the Bill is to give effect to certain aspects of the Government’s ports policy which was launched in January 2005. In line with the objectives of the ports policy, this Bill will underpin and enhance further the commercial freedom conferred on the State’s port companies under the Harbours Act 1996 to better reflect the changing environment in which they operate.

As an island nation, Ireland is dependent upon seaborne trade and the economic significance and importance of our ports to the State’s prosperity is self-evident. Given our open economy, Ireland’s international competitiveness is central to overall economic performance.

Our ports are vital gateways for commercial freight and sea passengers. This is highlighted by the fact that nine of the ten commercial State port companies are located in areas identified as gateways in the national spatial strategy. It is estimated that in 2007 merchandise goods to the value of €135 billion were transported along the Irish maritime supply chain. That figure is equivalent to 75% of our gross domestic product at current market prices. One of the core objectives of my Department’s Statement of Strategy 2008-2010 in relation to ports is to ensure “investment in ports meets capacity requirements and to facilitate the availability of commercial port services which are effective, competitive and cost efficient”. I am confident this Bill will enhance the ability of my Department and the maritime sector to meet this objective.

The year 2003 saw publication of the high level review of the State commercial ports operating under the Harbours Acts 1996 to 2000. This review was the first to be undertaken since the enactment of the Harbours Act 1996. That Act changed the status of the State’s ports from harbour authorities functioning under the Harbours Act 1946 to commercial port companies under the terms of the Harbours Act 1996 and gave them the commercial freedom to operate as modern customer-orientated service industries. The remit of the 2003 review was to examine critically the current model for the governance of the State commercial ports.

On foot of publication of the review, a comprehensive consultation process was initiated which involved interested parties making both written and oral submissions on future ports policy. The responses received fed into and informed the content and recommendations of the Government’s ports policy statement in 2005. The principal aims of the ports policy statement were to better equip the port sector and its stakeholders to meet national and regional capacity and service needs through clearer and more focused commercial mandates for the ports and their boards, enhancing board performance through reform of the structure of port boards, encouragement of private sector investment and involvement, sanction for the use of non-core [323]assets to fund new port development but not to mask inefficiencies, and encouragement of healthy competitive conditions within and also between ports.

Since the launch of the ports policy statement, the Department’s strategy has been to focus on implementing the recommended actions contained therein. This Bill is another important step towards ensuring our commercial ports are equipped to meet the challenges ahead in the competitive economic climate within which they operate.

A number of the objectives contained within the ports policy statement require legislative change and the Harbours (Amendment) Bill 2008 is designed to incorporate these important recommendations into primary legislation. The Bill also addresses certain anomalies in respect of that Act, which have come to light since its enactment.

The provisions of the Bill are considered necessary in light of a period of considerable change undergone by Irish ports over the past decade. The Bill will help to ensure they are equipped to grow as an integral driver of our economic success in the future. In particular, it is considered critical that commercial ports are given the capacity to provide cost-effective and efficient services to meet the needs of their customers, the State and the national economy. These high level targets could be described as being the ultimate objectives of this Bill.

While the explanatory and financial memorandum which was circulated to Members of the House along with the Bill contains a brief explanation of all of the sections of the Bill, I will highlight some of the significant changes and discuss them in greater detail.

One of the key challenges facing our commercial State ports is the provision of adequate and efficient capacity to ensure our economy can continue to grow and prosper. Notwithstanding the changed economic environment the ports and, indeed, the country are in currently, the ability to respond to capacity needs remains a critical concern for our ports and our economy in general. In response to a national ports capacity study commissioned by the Department in 2005, a number of ports submitted significant development proposals to address potential capacity requirements identified by the study.

One such proposal was that submitted by Drogheda Port Company on the development of a new port at Bremore. To facilitate this development it was proposed to alter the harbour limits of Drogheda Port Company. However, advice received from the Attorney General indicated that section 9 of the Harbours Act 1996 does not contain sufficient principles and policies to allow such an alteration under section 9(2)(a) and that the change proposed was not sufficiently technical to allow the limits of the harbour, listed in the Third Schedule of the 1996 Act, to be changed by secondary legislation. I have no doubt Senators will be aware that this advice is in line with the rulings given in the City View Press and Mulcreevy judgments.

Therefore, section 3 of this Bill will amend section 9 of the Principal Act and will allow a Minister to make an order that may either extend or move a company’s harbour limits as defined in Part I of the Third Schedule to the 1996 Act. Any extension to a company’s harbour limits is not restricted to an area contiguous to a company’s existing harbour limits; it may be an extension to include any area irrespective of location. However, in accordance with the legal advice received, there are a number of specific principles and policies a Minister must consider when making any order under this section. These include planning applications or planning permissions under the Planning and Development Acts 2000 to 2006, various regulatory processes under the Foreshore Act 1933, navigational safety and also the present and expected capacity of the harbour. This amendment will facilitate a port company’s growth either by expanding its existing harbour limits or designating additional areas as within the port company’s harbour limits.

The amendments contained within section 9 will allow port companies or a subsidiary, or either of them, to borrow up to €200 million or 50% of the value of their fixed assets, dependent [324]upon whichever is the higher. The borrowings will remain subject to the consent both of the Minister for Transport and the Minister for Finance. Additionally, the Bill specifies the principles and policies to which a Minister should have regard, should an order varying the 50% limit be made.

Another key focus of the ports policy statement was to enhance the commercial mandate of the port companies and to facilitate improved port company board performance through the reform of their board structure. The Bill sets out to achieve this aim through a number of important amendments.

Sections 4 and 5 seek to expand the commercial freedom of the port companies by providing a clear legislative basis to underpin investment by port companies outside their current harbour limits, as defined in the 1996 Act. The sections also allow for port company investment outside the State where a port company views such investment to be desirable and appropriate from a business perspective, subject to the approval of the Minister of Transport and the Minister for Finance.

Previously, port companies were restricted under section 11(4)(d) from investing outside the State unless such investment would “promote the interests of trade or tourism in the State”. Section 4 deletes this restrictive section. Section 5 provides that port companies may invest outside their harbour limits, which includes investment opportunities outside the State, provided that ministerial consent from both the Minister for Transport and the Minister for Finance has been granted.

This provision regarding investment outside a company’s harbour limits is considered appropriate to underpin and enhance the commercial freedom conferred on port companies under the 1996 Act and is one that is available to other commercial State bodies such as the Dublin Airport Authority and the ESB.

This Bill also contains a number of amendments designed to enhance board performance through reform of the structure of port boards. Currently, boards consist of 12 members and their membership is comprised of three directors appointed on the nomination of the local authority; one or two employee directors, depending on the size of the company, either elected by the employees or appointed by the Minister to represent their interests; the chief executive officer; and the remaining board members who are appointed at the discretion of the Minister.

Twelve directors is considered excessive for the State port companies. In the case of some of the smaller companies, the number of directors is greater than the number of employees. Therefore, section 8 amends the articles of association of the companies to provide that the number of directors shall not exceed eight. This reduction will be achieved by the abolition of the statutory appointment of local authority directors and a standardisation of employee board membership in order that all port companies will in future have not more than one employee director. Notwithstanding these changes, it is intended that all current directors will serve their full terms of office.

I wish to outline in greater detail the rationale behind these amendments and the context in which they are being made. With regard to local authority membership of port boards, a performance audit of the companies in 2001-02, undertaken by Jonathan Packer, recommended that the statutory provision for local authority directors be abolished. The 2003 high-level review of the State commercial ports concurred with this recommendation and concluded that the practise of appointing port users, local councillors and those without relevant experience should cease.

The developments that have occurred in the sector since the Harbours Act 1996 have resulted in a major organisational and cultural change within the ports. While there have been substan[325]tial and valuable inputs from local authority directors through the years, the rationale for such statutory representation on the boards of State bodies, operating under a statutory commercial remit, is no longer compelling. No similar practice exists in other commercial State companies, such as the airports.

Notwithstanding that, it is my intention to continue to appoint a local authority director from among my own statutory nominees. This decision is consistent with the principles set out in the ports policy statement. It will help to alleviate the understandable concerns of those who feel that this removal of the statutory provision represents an unwelcome break from tradition. The appointment of port users to boards of the commercial State port companies can lead to conflicts of interest and, in line with the port policy statement, this practice will cease with regard to all future appointments.

Section 11 provides that no person may be recommended for appointment to a board if that person, within the three years preceding the recommendation, had a charge imposed upon him or her by that company under section 13 of the Act, was an employee of a person who had a charge so imposed, had provided a significant commercial service to that port company, or was an employee of a person who had provided such a service. The section also provides for a recommending person who is unsure if a service provided to a company would constitute a significant service to advise the Minister of the facts and the Minister may decide whether the service provided constitutes a significant commercial service. While this section will prevent directors who have close commercial connections with a particular port being appointed to that board, it will not prevent the appointment of individuals with valuable industry expertise who do not have commercial connections to the port in question.

As I mentioned earlier, the reduction in board sizes will see employee representation set at one employee director, irrespective of port company size. Currently, a system applies whereby those companies with more than 50 employees appoint two employee directors following a ballot as per regulations set out in the Fifth Schedule to the Act. Companies with between 30 and 50 employees appoint one director following a similar ballot. However, the practice of holding elections, as prescribed in section 30 of the 1996 Act, can lead to practical difficulties in its application, as there are companies whose employee numbers are subject to fluctuation during any given year. This can lead to companies exceeding the threshold level for an election, which leads to a ballot being triggered under section 30 of the 1996 Act, only for the numbers to fall later below the threshold level — for example, due to retirement.

Such a scenario can lead to unnecessary expense for port companies and, therefore, section 11 proposes to address this matter by introducing an “averaging” system similar to that enacted in the Companies (Amendment) Act 1986, relating to the calculation of the average number of employees of a company during any given year. Elections for employee directors will be held in companies where the average number of employees will exceed 30. All references in the Act to the threshold of 50 employees will be removed, as all companies will now appoint only one employee director. In the case of companies with less than 30 employees, the Minister will continue to appoint a person who, in his or her opinion, is representative of the interests of the company.

Turning to regional harbours, the ports policy statement made a number of points in respect of the harbour authorities operating under the Harbours Act 1946. It stated that the continued operation of many of the regional harbours under the outdated provisions of the Harbours Act 1946 is unsustainable on the grounds of good governance. The statement reiterated the view that most of these harbours would best achieve their potential through their transfer to local control in cases where there is little or no commercial traffic and, in harbours where significant commercial traffic exists, consideration will be given to bringing them under the control of a [326]nearby port company. The Bill underpins these statements by providing the necessary legislative base to enable these options to be fully realised. A number of amendments in sections 17 and 18 provide this necessary legislative change.

In 1996, consideration was given to establishing a commercial port company in respect of Arklow harbour. Accordingly, it was not included in the list of harbours in section 87(2) of the Harbours Act 1996, which could, subject to a ministerial order, be transferred to a relevant local authority. Due to the fact that Arklow harbour now has no significant commercial traffic, it is considered appropriate that it should appear in this list, which will permit its transfer to local authority control along with other similar harbours across the country. Section 17 will, therefore, delete Arklow harbour from the list of harbours to be established as port companies and include it in the list of harbours in section 87(2), which may be transferred to local authority control subject to a ministerial order.

As I mentioned earlier, the ports policy statement provided that in the case of harbour authorities where significant commercial traffic exists, consideration would be given to bringing such harbours under the control of a port company. As significant commercial traffic exists only at Bantry Bay and Tralee and Fenit pier and harbour, it is not considered necessary to introduce a general provision allowing for such a transfer. Section 18 deals specifically with these two harbours.

Upon enactment of this Bill, the Minister for Transport will have the necessary authority, under section 87A(2), to make an order transferring Bantry Bay harbour to the Port of Cork Company and to transfer Tralee and Fenit pier and harbour to Shannon Foynes Port Company. Such a provision is consistent with the recommendations of the Ports Policy Statement and ensures that each of these harbour authorities has access to the best regional port management expertise, marketing skills and strategic development planning.

The Bill also contains a number of amendments to the Harbours Act 1996 in relation to pilotage and pilotage services. These changes address a number of issues identified since the original Act was passed and also changes that are required on foot of other amendments I have already discussed, such as the provision to alter harbour limits.

Sections 12 and 16 contain useful amendments to the powers of a Minister to alter the limits of a pilotage district. These amendments mirror the proposed changes contained in section 3 relating to harbour limits and allow for a ministerial order to alter the limits of a pilotage district having regard to certain principles and policies.

Section 16 also corrects an anomaly that has arisen with regard to the provision of pilotage services by harbour authorities. The Pilotage Act 1913 was repealed in its entirety by virtue of a statutory instrument made under the Harbours Act 1996. While a saving clause was included in the Harbours Act regarding by-laws made under the Pilotage Act 1913 with regard to the pilotage districts of port companies, no such clause was included for those of harbour authorities.

Therefore, this section empowers the Minister for Transport to not only re-organise pilotage services as outlined previously, but to also confer on a specified person the function of organising and ensuring the provision of pilotage services in the particular pilotage district. This will enable a Minister for Transport to designate the relevant harbour authority or local authority, as the case may be, to be that specified person and will address the issue caused by the repeal of the Pilotage Act 1913.

Sections 13, 14 and 15 make further changes to the pilotage provisions contained in the 1996 Act by harmonising elements of the regulations regarding pilotage charges with those of harbour charges, re-adjusting the bond payable by a pilot in terms of limiting his liability and [327]updating the regulations around pilotage exemption certificates. These changes ensure that the Act is updated to take into account the changes that have occurred since its enactment in 1996.

The final element of this Bill I propose to highlight is section 7, which pertains to the transfer of certain ministerial responsibility regarding the compulsory purchase of land by port companies to An Bord Pleanála. Currently, port companies seeking to make a compulsory purchase order must apply for a ministerial acquisition order under the Fourth Schedule to the Harbours Act 1996. While this function has only been exercised once since its enactment, it is felt more appropriate that this power be transferred to An Bord Pleanála given its role, pursuant to the Planning and Development (Strategic Infrastructure) Act 2006, as the determining body in respect of planning consent for strategic infrastructure developments at commercial ports.

With this new role conferred on the board since 2006 with regard to strategic infrastructure, it is anticipated that An Bord Pleanála will over time acquire and build up a body of expertise and experience on the planning aspects of major infrastructural development generally and particularly, in this case, in port projects. In these circumstances, a strong case can be made that the board would be better placed to adjudicate on port company applications for the compulsory acquisition of land rather than the Minister of the day. In light of the above, and the fact that similar functions with regard to the compulsory acquisition of land by Aer Rianta — now the Dublin Airport Authority — were transferred to the board under the Air Navigation and Transport (Amendment) Act 1998, I believe that this proposal is the correct approach to take with regard to the State commercial ports.

I am confident that the Bill will further underpin the commercial ethos introduced into our ports sector by the Harbours Act 1996. With the enactment of the Bill, our State commercial ports will be better placed to respond to the challenges posed by the demanding environment in which they operate. It is evident to all of us that one of the cornerstones of our economic success is the ability of our ports to adapt to changing markets and to have the commercial ability to build upon their success for the future. I am confident the Bill will help accommodate those objectives and I commend this Bill to the House.

Senator Maurice Cummins:I welcome the Minister of State to the House. I am deputising for Senator Donohoe who is my party’s spokesperson in this area. As an employee of Waterford Port for over 20 years, a former chairman of the old harbour commissioners and a director of the first port board in 1996, I have a long-standing interest in portal affairs, harbours and, in particular, commercial ports in the country.

This is important legislation. I wish to identify what we in Fine Gael believe to be the key priorities for it, the main questions which need to be answered and the issues to be resolved, possibly on Committee Stage.

The main policy document for evaluating this legislation is the Ports Policy Statement of 2005. It recognises, first, that our ports are essential to our nation’s prosperity — ten ports bring through almost 99% of the goods that are essential to our prosperity. Second, it identifies two crucial challenges. There is a shortfall of 12.2 million tonnes of goods to be carried between now and 2015; in other words, there is not the capacity to meet the present and, indeed, future demands on our economy. Third, there will be a funding shortfall. In the challenging days in which we find ourselves, this may be even bigger than we think. These three challenges must be met, which is why this legislation is so important.

Fine Gael has identified a number of concerns regarding the legislation which we will seek to have answered and resolved on Committee Stage. First, we must further understand the power which this Bill allows the port authorities to compulsorily purchase land. It is unclear to [328]us at this stage whether the existing power is being reallocated or additional power is being created, and this needs to be clarified.

Second, we believe that any port development must recognise the local conditions and environment within which the port is situated. This Bill is not strong enough in this regard. It must take more account of the county and city development plans. This is a necessity.

Third, we have real concerns about the further reduction of the role of local politicians. The Bill is a further attack on local democracy and the men and women who do vital work for their communities, which we must acknowledge and continue to support. This is another attack on the fine work of local authorities by the Government.

The number of port authority directors is being reduced from 12 to eight. The number of directors appointed by the local authority is being reduced from three to a possible one. In Waterford, for instance, there is one from Waterford city, one from Waterford county and one from County Kilkenny, where the port is situated. The legislation states that the Minister may appoint from within his own nominations one director.

3 o’clock

The Minister of State referred to a 2001-02 report which recommended that statutory provision of local authorities directors be abolished. Can we have the reasons local authority members should not be members of port authorities or regional harbour authorities? As a former member of those boards, I am aware that the board members who were local authority members were conversant with the local issues and did not have any vested interests. I acknowledge the point made regarding port users, that they should not have membership of the boards because of a potential conflict of interest, but I can see no reason why local authority members should not be members of these boards. The reduction is a retrograde step. The Members on the Government side of the House have raised this issue on numerous occasions. There has been a flow of legislation through the House in which civil servants have decided that local authority members should not be members of semi-State boards. Why should people with interest and experience in local authorities, who can and should be members of these boards, be excluded? They are elected by the people. Why exclude them?

This rat race to keep local authority members off these boards can only be stopped by the Members on the Government side of the House. We can shout until kingdom come and people can nod and agree with us but the Members on the Government side must stand up and call a halt to this. What we are saying about local authority members is correct, especially in this instance with regard to the Harbours (Amendment) Bill. I hope we will have support on Committee Stage and that the Government Members will call a halt to this and stop the erosion of the powers of local authority members.

I agree with the recommendation that port users should probably be excluded from directorships of the port companies because of a possible conflict of interest. I saw what has happened in the past so I have no difficulty with that provision. However, I have a difficulty with that policy where local authority members are concerned.

The fourth point which must be addressed is the amalgamation of port authorities. This requires careful consideration. Perhaps the Minister will elaborate on the need for the amalgamation of port authorities. I consider it a good idea but the issue should be teased out a little more.

Fifth, we must be careful in our definition of commercial activity. The prime function and role of the ports is to cater for the shipping needs of our economy. All other activities are ancillary to that function. The increase in the borrowing capacity of port companies is welcome. The port companies will have less restrictive obligations under the Bill and that is also welcome. [329] The commercial activity of ports must be assisted. A total of 98% of the goods that come into this country come through our ports so they deserve every possible assistance.

Fine Gael understands the need for this legislation and the policy behind it. However, important questions must be dealt with. We will certainly not tolerate a further assault on the rights of local authority members and local politicians who do such good work on the boards of port companies and regional harbour boards. I hope our concerns will be considered and addressed on Committee Stage and that we will have the full support of Members on the Government side of the House in this regard.

Senator John Ellis:This is an opportunity for us to examine the situation in the country’s ports. I agree with Senator Cummins on one issue. The race to remove elected local authority members from public bodies arose previously with the Dublin Transport Authority Bill. On that occasion the Minister accepted an amendment that originated from the Government side of the House and was agreed by all sides. The same should be done with port authorities. If the membership of a port company is to be reduced to eight, there should be a pro rata reduction in the number of local authority members. When the membership was 12, there were three local authority members, so consideration should be given to two of the eight members being local authority members.

The local authority plays a major role for ports. It is responsible for roads to the port and for overall development in the port area. The Minister has discretion to appoint a local authority member to the board but that does not mean the Minister will not be lobbied by every Member seeking to have X, Y or Z appointed, not because he or she might be the best person to do the job but because we will all be put under the famous old political pressure to do something for the individual. The local authorities have always been reasonably fair in making these appointments and, in most cases, have politically divided them to ensure a balance. Irrespective of who the Minister of the day will be, he or she will have to bow to his or her political colleagues when appointing a local authority member. It might be easier for the Minister if the local authorities appointed their own representatives. The Minister would then only have to worry about appointing people who have the commercial orientation necessary to develop our ports further.

This Bill was undertaken as a result of the Jonathan Packer report. That report is six years old. I have fears about depending on something that old. I am aware the Minister has taken the advice of the Department about this but reflecting on something that is six years old and trying to move on from that to frame legislation could result in the legislation being out of date before it is out of the Houses. There will be anomalies left, right and centre because of the development that has taken place in this country over the past ten to 15 years.

There is a degree of concern about some of the smaller ports that are due to be subsumed into the larger ports. That is the case with Bantry and the two Kerry ports. A case should be made for some of these smaller ports. Bantry, for example, is used by only a few people but it has quite an amount of cash reserves, which cannot be said for some of the other ports. Something could be done to allow that port to continue as an independent entity. I am saying this too on behalf of my colleague, Senator O’Donovan, who regrettably cannot be present today. He has expressed a view on this issue and I accept that view. I saw what happened with the rationalisation of co-operatives. The smaller co-operatives that had cash were taken over by the bigger players who needed the cash reserves to keep themselves in business. The same is happening with Bantry. I urge the Minister to review this and see if something can be done to maintain the port as it is.

I have fears about An Bord Pleanála being the deciding body in land acquisition. If it takes that body as long to deal with land acquisition for a port as it does to give decisions on any [330]type of complicated or semi-complicated planning case, the port’s need would be long past before it could get access to the land. It would be more understandable if the planning element were sent immediately to An Bord Pleanála rather than going through the local authority, but that is not suggested in the Bill.

There is a need to remove bodies such as An Bord Pleanála and as many other quangos as possible from legislation. They prevent progress. At least when a Minister has to make a decision, it is up to those in the Department to implement it. However, if, for example, the proposed new port in north Dublin is sent to An Bord Pleanála, it will be there for eternity. Something must be done about this. The compulsory purchase order powers should remain vested in the Minister rather than be handed over to An Bord Pleanála. I can understand the issue going to the outside body for planning once the area to be acquired has been decided, but definitely not the acquisition. The Minister should review this.

After all, this takes away some of the Minister’s powers. I doubt any Member wants that to happen in this case. Too much ministerial power has been given to quangos over recent years. There is a need for Ministers to exercise their powers. Ministerial office does not simply mean dealing with public relations matters all the time. The office exists to take decisions that are in the national interest. The best people to make those decisions are politicians, irrespective of their political parties. Politicians must face the electorate and people who do not should have only an implementation role. This applies to practically every body in this country. When Ministers make decisions, nine times out of ten they are much better than those made by the quangos. Considerable power has been ceded to the latter by Ministers in the past 20 to 25 years, or since I first came into this House. This is regrettable as far as John Citizen is concerned because he cannot gain access to anybody with decision-making power.

There is a need for total rationalisation of many of the quangos, which are not answerable to anybody. A Minister is answerable to the Houses of the Oireachtas or committees thereof. However, some of the quangos, if invited to appear before an Oireachtas committee, would tell it they had no responsibility in that regard and did not have to accept anything. They are autonomous and have far too much power in the development of this country.

A number of major ports are not mentioned in the legislation. Who will set the port tariffs? Will the bigger users be treated preferentially to kill off the smaller users of some of our ports? We have all heard allegations in recent weeks to the effect that large companies are getting much more beneficial rates than some of the small ones. I have written to the chairman of the port concerned to determine whether this is the case. If it is, the small operators will never be able to develop shipping lines from this country. We have all seen the detrimental effect of monopolies on our economy. The Minister of State pointed out in his opening remarks that 75% of our exports leave by sea. This places an enormous responsibility on the Government to ensure there will be equal access and help in respect of ports and their development.

Reference has been made to the north Dublin port and the one in Drogheda. Further north there are ports in Greenore, Warrenpoint, Larne and Derry. In the west, Killybegs is being developed further as a port. What co-ordination is there between the Department of Transport, which now has responsibility for ports, and its counterpart in Northern Ireland? It is important to the part of the country from where I come that there be good access to Derry, Warrenpoint or Larne, which have been used traditionally by port traffic. Much traffic from the west and north west of the Republic has gone through these ports.

A co-ordinated effort could lead to major savings right across the board. It is desirable that one be able to avail of a proper service from the nearest port rather than having to hawk commodities from Donegal to Waterford or Rosslare. It is a much shorter spin to Larne, [331]Warrenpoint or Dublin. This needs to be considered. When we create a full port policy, we should do so on a national basis and seek agreement from our elected colleagues in Northern Ireland that this be the approach. This is very important and I appeal to the Minister of State to determine what can be done in this regard.

We would all support the concept of ports having sufficient capability to borrow. If they are to be competitive, they must have the most modern equipment, be it X-ray equipment, handling equipment or otherwise.

I am a little worried over who decides what constitutes 50% of the value of a port. Is it calculated by the auditors in their report to the port company or is there an actual valuation? Much of the value is theoretical and I hope that, because of the way in which we have increased the sum that may be borrowed by a port, they will not end up in debt beyond their capacity to repay. Some ports are dependent on certain lines of business. If they were to lose that business or certain commodity businesses, they would find very quickly that they could not honour major commitments.

We all welcome this Bill because we need to upgrade our ports as much as possible. I appeal to the Minister of State to consider on Committee Stage an amendment to allow for local authority members to be representedon a pro rata basis. Given that the number of directors is to be reduced from 12 to eight, the number of local authority members should be reduced from three to two.

When appointing ministerial nominees, the only people who should be considered are those with a commercial background who know what needs to be done. They may be associated with another port some distance away or with international trade, but they must understand what needs to be done. The day of appointing somebody because he or she is a good accountant, county manager or county secretary is over. The day should come on which all ports will be run as commercial entities with the intention of making them profitable and improving the manner in which they can facilitate exportation and importation. We must accept traffic in both directions. If we do not run them as commercial entities, they will end up being run out of business by our colleagues in Northern Ireland.

Senator Michael McCarthy:I thank the Cathaoirleach for the opportunity to speak on this important and controversial Bill. I welcome the Minister of State, Deputy Noel Ahern, who was in this House on many occasions during the last term in his various capacities as Minister of State. We had very robust debates with him and I always found him to be a very good colleague in terms of parliamentary debate.

This Bill is being introduced as it is considered necessary to give effect to certain aspects of the Government’s policy as set out in the ports policy statement of 2005. The principal objectives of the Bill, as stated in the explanatory memorandum, relate to the Harbours Act 1996, which contains guidelines for port companies on the acquisition of land. It also addresses issues associated with the disposal of land. Other objectives are to provide for the transfer of functions from the Minister for Transport to An Bord Pleanála in the context of the compulsory acquisition of land by port companies and to alter the limits of Drogheda Port Company to facilitate the proposal to build a new port in Balbriggan. Amendments are considered necessary in this regard. Furthermore, there is to be provision for a clear legislative basis to underpin investment by port companies outside their current harbour limits. Finally, the number of directors in a port company is to be reduced from 12 to eight.

The first four objectives seem reasonably compelling in that they are to amend legislation that is limited in its current form. We can accept them. However, I wish to focus on the last expressed reason for the legislation, that is, the reduction from 12 to eight of the number of [332]directors in a port company, as provided for in section 11. I am very disturbed by the Minister’s motivation in this respect. The reduction being proposed is at the expense of three local authority members and the user representative.

The Minister of State, Deputy Noel Ahern, was in the Department of the Environment, Heritage and Local Government and will have debated the role of elected councillors in local authorities. We have debated their resources and limited functions. By and large, the Members of this House are elected by members of local authorities throughout the country, with the exception of the six Senators from the National University of Ireland and Trinity College Dublin and the 11 Taoiseach’s nominees. The majority of us have served on county councils. I was very lucky and honoured to be elected to Cork County Council at 22 years of age. I served as vice chairman of the full council and as chairman of its western division on two occasions. The majority of councillors are hard-working, decent people. We are all well aware of the unlimited number of hours they devote to their work as members of local authorities, the sacrifices they make and the limitations to their role.

On several occasions in this House, I have pointed out what I believe is the democratic deficit that currently dogs local government, namely, the difference between the reserved function and the executive function. Those who are members of local authorities have a reserved function, which means they can recommend to council that a certain course of action can be taken. Of course, the executive function, the real decision-making power, rests with county and city managers. If we are serious about local government reform, we must address this anomaly in the system.

This brings me to the matter at hand. I cannot understand why any Government would want to see local authority membership wiped from the boards of the ports throughout this country. I cannot understand why the Government is so intent on taking away functions from local authority members. If we have learned anything from attending councillors’ conferences or from being councillors, it is that councillors want more powers and real input into local government. They do not want to be told that the power to set a rate collection charge is being taken from them and given to the manager. They are now being told to skedaddle from the boards of the ports, which is not good enough.

This view is held on both sides of this House. To be fair to Government Members, they are here to support Government legislation. However, the Minister and the Government would do well to listen to the points of view expressed by Members of all political persuasions in this House. We are speaking from experience. We have consulted with colleagues in local government, who are seriously concerned with the manner in which the Government is dealing with this issue. I cannot understand it. I hope the Minister takes this argument on board.

The Minister for Transport is a former Minister for the Environment, Heritage and Local Government. He first flew the flag in regard to the abolition of the dual mandate and, as he has served on a local authority, he is acutely aware of the faults and failings of local government. He is also aware of the manner in which councillors are expected to carry out onerous tasks while not being well remunerated or afforded the proper democratic right to exercise functions, despite the trust placed in them by those who have elected them to local authorities. This is an issue of which we must by fully cognisant.

I appeal to the Minister of State, Deputy Noel Ahern, to carry the message back to the Minister, Deputy Dempsey, that he should drop this ridiculous idea. I understand there is an argument, based on reports, that this should be the case but the democratic views of the Members of this House need to be taken into consideration.

[333]Worker representation takes a hit and will be confined to one representative. My party will oppose this move, particularly in regard to local authorities and worker representatives. We would not be doing our job properly if we did not do so.

Amendments under section 11 are supposed to reflect the provisions of the ports policy statement of 2005. While that statement indicates that 12 members is considered to be excessive, which we accept in the spirit in which it is intended, it does not make any recommendation as to what the lower number should be. The smaller number might be ten rather than eight. Where did the Minister get this figure? Why is he going beyond what is stated in the ports policy statement of 2005?

The ports policy statement recommends a reduction in the number of local authority members from three to one. This amendment appears to reduce the number to zero. Will the Minister of State clarify whether this is the case and outline the thinking behind this amendment? If the answer to these questions is that the Minister is indeed going beyond the ports policy statement, why is he doing so, and why is this particularly the case with regard to local authority membership? Is the Minister ideologically opposed to having local authority members on boards? If the answer is “Yes”, it begs the question why this is the case and whether it is party policy.

From discussing the Bill with some Members opposite, I am aware there are those on the other side of the House who are particularly supportive of the points I make in this regard, although they are constrained because they are on the Government side. I ask the Minister of State to listen to the democratic wishes of his own party.

I would expect the Minister of State to answer the following questions. Why is the Government so determined on this provision? From where does it come? Whose agenda is it? Is it ideological? What is the thinking behind it? Has the Minister of State consulted the grassroots of his own organisation? Has the Minister consulted the various council representative groups? Has he consulted councillors in his own party? If the answer to all of these questions is “Yes”, did any of those organisations share the view that Government should reduce local authority membership on these boards?

A fundamental part of our local government system is those who come through it. Those who are successful in local authority elections are representative of their community and bring a fundamental part of democracy with them to the council chamber, the health boards of the old system, the VECs and the ports. I know many councillors who have served the port of Cork. I have served on it and have ratified appointments to it, and know the councillors are fine, decent people and a good conduit between local government and the outside bodies to which they have been appointed. I see no compelling reason they should be removed from the board.

I am aware Members opposite cannot directly oppose the Minister on this issue. However, while I look forward to hearing the Minister of State’s reply, if the Minister refuses to budge from his position I would appeal to Members on the other side of the House to approach him privately to beseech him to listen to common sense in this regard. I am certain our electorate have a view — I am speaking with regard to those Senators who have been elected because of the support of members of county councils from Donegal to Cork and Dublin to Galway. We will oppose this section and I have no doubt Fine Gael will do the same. I earnestly ask Members on the other side of the House to stand up and be counted on this issue.The Minister can do what is legally necessary. He can make the changes that are definitely needed, but he does not have to do this at the expense of local democracy and local government.

Section 18 has serious implications for Bantry and west Cork. Bantry Bay Harbour Commissioners has substantially funded the new slipway at Whiddy Island and is now involved with [334]the one proposed for the mainland beside the Abbey cemetery in Bantry. The commissioners also purchased the old railway pier foreshore rights from Bantry House for the full market value and own and control the existing pier. Bantry Bay Harbour Commissioners made a profit each year since 1996 except 2004. Conoco Phillips is the company involved in the facility on Whiddy Island and it looks likely it will invest substantially in that facility to repair and refurbish oil storage and other facilities.

To be parochial, the Bantry Bay Harbour Commissioners has unanimously on several occasions rejected proposals for a merger with or takeover by the Cork port authority. Solid assurances were given by the Minister, Deputy Dempsey, on many previous occasions that any decision would be based on consultation with the people concerned. A letter sent by the Minister last month to the chairman of Bantry Bay Harbour Commissioners, Mr. Aiden McCarthy, refers to a letter sent by the harbour authority to the Minister outlining its concerns. The Minister gives an assurance in this correspondence that any decision the Government would make in this regard would only be made following consultation with the people involved. I regret to add no such consultation was entered into with the people concerned before this legislation arrived at its current stage.

I appeal to the Minister to leave Bantry port alone. It is financially capable of operating on its own basis and we do not need it to be subsumed into the port of Cork. This view is held unanimously by Bantry Town Council and Bantry Bay Harbour Commissioners and it is also a view held by other Oireachtas Members for Cork South-West. I urge the Government to listen to us. If there is an insistence in this regard on the further Stages of the Bill, I will oppose it.

Senator Dan Boyle:This Bill seeks to give statutory effect to the Government’s port policy statement. The definition of a port policy statement can be taken to mean a statement of the port policy of the Government. I tend to think of it as a statement of the Government moving towards a ports policy, because it is an evolving policy area over several years and it is clear this Bill is an attempt to meet some of the gaps remaining.

The question of the dependence of an island nation on harbours is unanswerable, and the need to have a statutory effect to ensure they operate to their optimum level cannot be debated. The Bill answers many of the questions that need to be answered. The Harbours Act 1996 brought about changes from the old harbour commissioners system in larger ports, where port companies were established and a more commercial system was put in place. This allowed the evolution of a competition policy between many of the larger ports in the country. The existence of competition allows for more traffic for exports and imports, and thereby increases the viability of the ports.

Increasing the economic activity of the ports is an aim of Government policy in itself, but there are other areas we need to examine, such as the capacity of the ports that exist. The most supported port in terms of infrastructure is the Europort in Rosslare, the most under-utilised port in the country. Where is our policy going when we have substantial investment in major ports that are not utilised to their full capability?

When goods are imported and exported we should have a transport policy that identifies particular ports so the minimum impact on transport on the island is achieved. The problem with an open competition policy is that one is encouraging goods to be imported to or exported from Donegal and sent out through any of the ports in the country. That is not environmentally sound and does not make good economic sense. A harbour or ports policy should address these inconsistencies. The Bill moves towards that, but there is much work to be done, and I hope that will be done in the formation of a fully-fledged ports policy and in later legislation.

[335]Many of the locations of existing ports do not meet modern needs. The ports themselves are developed, or they are relocated. In Cork there has been an attempt by the Port of Cork Company to achieve a relocation through the use of the Planning and Development (Strategic Infrastructure) Act 2006. It went through An Bord Pleanála and argued to move all its facilities to Ringaskiddy at the lower end of Cork Harbour. This failed, and one of the reasons for that was that — another lacuna in harbours policy — in terms of transport infrastructure, it should be an accepted fact that rail links are a prerequisite. It is economically stupid, as well as environmentally damaging, to develop new locations, in north Dublin or elsewhere, without an insistence on rail links as a matter of policy. I would like to see the development of a ports policy along these grounds.

As a nominated member of the Seanad, I am aware that while we are discussing the Harbours (Amendment) Bill 2008, we spend an undue amount of time on particular provisions and how they relate to local authority members. That cannot be unconnected to the fact that a large part of the electorate for most Members of this House are local authority members. I understand why Members feel the need to address those concerns. It is a distortion of what this Bill is about, and I ask that on Committee Stage the more important commercially and economically sensitive elements of the Bill are examined more carefully.

Most of the legislation that prohibits local authority members from membership of all State bodies and agencies needs to be reformed. If there is an expertise and skill in local government, it should be encouraged and people should be allowed to be appointed to such bodies. If legislation states that there should be a minimum participation of local government representatives, regardless of whether those skills exist in local authorities themselves, that is not in the interests of local government or their members. It may be technically feasible that in any port company the 12, 15 or 17 members are local authority members or, conversely, if the specific skills do not exist in that local authority, then none of them should be members. If we are interested in bringing up the standard of public representation, that is what we need to achieve. We need a skills set, whether in harbours, education or healthcare and not just members sitting on bodies for the sake of it. If we can achieve that, there will be more respect for politics in general and identification with local government in particular. Members in this House, because of their special relationship with members of local authorities, should reflect on those facts and see how we can improve matters in this regard.

In my own area in Cork there is a conflict of interest between the local authorities - Cork City Council and Cork County Council - and the Port of Cork Company, particularly towards the development of the Port of Cork Company. The city’s interest is in developing the south city docklands which, outside of irregular cargos for IAWS which are happy to move to a new location, is ripe for new development and would bring new life to the city. Instead we have a stand-off between the Port of Cork Company and the local authorities that sees little movement to allow such redevelopment to occur. That is despite the fact that Cork City Council has direct representation on the Port of Cork Company. Even where representation exists, what is the value of it when it cannot deal with these vitally important issues of infrastructure and economic development at a local level?

Senator Michael McCarthy:In the case of Bantry, my point is proven.

Senator Dan Boyle:I understand the Senator’s point about Bantry and I am prepared to listen to the arguments. There are economies of scale that need to be taken into account, and this Bill is about that. There is a case for some linkage between the port of Cork and Bantry port, if only to have a responsibility for a body of the State for the oil refinery facilities in Whitegate and the oil storage facilities in Whiddy. It would make sense to have somebody responsible for both, rather than having the responsibility divided in two. I heard what other [336]Members said, and I believe that is the intent of what is proposed in the Bill. We can discuss on Committee Stage whether that is a good or a bad thing.

We are discussing a reduction in the number of ports that are recognised in this legislation. If the identification of these ports is not linked with an overall transportation plan that has identified rail links and identifies where the goods are coming from and going to within a set radius of each port, we will not achieve the potential of existing ports.

I welcome what the Bill seeks to do and I recognise it as a further evolution of a policy that still has a journey to go before it is fully fledged. The debate today and the examination of the Bill on Committee Stage, and discussion in the other House, will allow us to develop a policy that, sadly, for an island nation for too long has not been fully developed.

Senator Paul Coghlan:With the permission of the House, I wish to share time with Senator Paddy Burke.

An Cathaoirleach:Is that agreed? Agreed.

Senator Paul Coghlan:I welcome the Minister of State, Deputy Devins. It is good to see him. I do not know a lot about the legislation as it is not within my area of competence——

Senator Michael McCarthy:It is a fine, wide area of competence.

An Cathaoirleach:Senator Coghlan should be allowed to speak without interruption.

Senator Paul Coghlan:——but it does provide that the number of directors of a port company should be reduced from 12 to eight. I listened to the contributions of Senators Cummins and Ellis, among others, on the monitor in my office, without really intending to do so. I agree with both of them. I do not know if my colleague from north Kerry has spoken yet.

Senator Paul Coghlan:No. I know that man’s views because I know how disgracefully he was treated in regard to a port company.

We oppose the section. It is a studied assault on local democracy and on decent people. Everyone in this House would defend the right of local authority members to be on those boards. The number of board members is being reduced. I understand that the Minister may appoint one board member. We on this side of the House do not accept that. It is wrong. We, as politicians who have put ourselves forward for so many years to be elected, and who are fortunate to be here, should not show such scant regard for colleagues serving on local authorities who do such good work.

Members opposite and the Minister will have the chance to respond to tell me how firmly that is Government policy. Senators will agree this is creeping through all Departments. As Senator Ellis pointed out, we have seen this before although I cannot remember the last instance of it. It seems as though someone in the so-called permanent government is getting at the Government of the day. These instances have occurred once or twice in the ten years or so that I have been a Member of the House. We need to cry “Halt”. As politicians, we should have the guts to put down the appropriate amendment, which I hope we will. We are all behind [337]it. I would like to think Ministers would not think differently to us on how local democracy should be conducted.

I did not hear what Senator McCarthy said about Bantry. I believe Bantry and Fenit — Senator O’Sullivan may be more competent when it comes to Fenit — are strategically located ports and they should be made autonomous. Putting Bantry in with Cork is not something anyone in Bantry wants. There is approximately 100 miles of coastline between Bantry and Cork. Bantry is a very busy port in its own right and it deserves encouragement even if sufficient funding is not available currently. Equally, Fenit deserves to be autonomous, not to become an adjunct of Foynes and Shannon. I have no doubt Senator O’Sullivan will contribute on that point. Other than those points I have nothing further to say and I am happy to hand over to my colleague.

Senator Paddy Burke:I thank Senator Coghlan for sharing time with me. I also welcome the Minister of State, Deputy Devins. I welcome the Bill but I am amazed at some aspects of it. I do not like the provision for the transfer of functions from the Minister for Transport to An Bord Pleanála in the context of the compulsory acquisition of land by a port company. That is a major power. I cannot understand why the Minister would not give that power to the local authority in question. If the Minister with responsibility for the marine had given power to the local authority rather than a private company we would not have the long debacle we have had on our hands with Shell in north Mayo in recent years. That considerable power is being handed over to unelected people. The Minister should reconsider and vest the power to compulsorily acquire land in local authorities.

The Minister for the Environment, Heritage and Local Government gave away nearly all of his powers when he gave away harbours, ports and transport to the Department of Transport. His role is considerably diminished now. The Minister for Transport is now giving away further powers. I am not too happy with the position vis-à-vis public representatives. We are told the Minister cannot intervene in companies such as CIE, the Health Service Executive and the National Roads Authority because power is vested in them and they are a law unto themselves. However, nearly every county development plan in the country has been altered by the Minister for the Environment, Heritage and Local Government. On the one hand, we give away power and say the Minister cannot intervene in the Health Service Executive, the National Roads Authority, CIE, etc., but on the other hand, the Minister for the Environment, Heritage and Local Government can interfere willy-nilly in the affairs of local authorities. Instead of having locally elected people, those with no electoral accountability are being put in charge. In the case of the Health Service Executive the Minister removed locally elected people from the boards.

I am not enamoured of the change that has taken place and that has been presided over by Fianna Fáil in government in the recent years. I urge the Minister of State to convey my views to the Minister for Transport and to consider the case for the appointment of public representatives to harbour boards. I fail to understand why they should not be appointed to such boards, as they are elected and accountable and they have done a magnificent job in the past, yet we are now passing legislation to vest the power in unelected people. I urge the Minister to examine the matter prior to Committee Stage.

Senator Ciaran Cannon:I welcome the opportunity to speak on the legislation, which has been drafted to enhance the long-term viability of the ports around our island nation. Our long-standing maritime tradition is one aspect of the economy that is often overlooked and the legislation shines a badly needed spotlight on the sector. It seeks to allow harbour authorities the flexibility and autonomy to operate in a high-pressured global environment and to create the kind of conditions needed to increase commercial activity in ports.

[338]We currently have ten State port companies operating on our coasts and each of those companies has plans for the expansion and enhancement of its facilities in the coming years. Some of the ports are already in the middle of major expansion. For example, we recently saw the opening of a 190 m quay extension at the port of Waterford at a cost of €11 million. That extension will boost the port’s growing cargo business and its reputation as one of north-west Europe’s key maritime hubs. The new facility provides the port of Waterford and the commercial and industrial activities in its vicinity with the room to continue to grow into the future. In Cork there are progressive companies, for example, Mainport, which has gone in the past five or six years from owning and operating five or six vessels to 30, including seven recent vessel acquisitions.

Irish-based ship owners demonstrate that, given the right conditions, they can compete in tough, highly challenging global markets. On 1 August 2008 the Irish Maritime Development Office announced expansion plans by seven Irish-based shipping groups with an expected total cost of almost €1 billion. In the first six months of 2008, 21 new and second-hand vessels were acquired with a further 27 vessels confirmed or expected to be delivered over the next two years, most of which are newly built. While economic conditions in Ireland will be tougher in coming years, this is clearly not a factor constraining those Irish maritime companies that continue to compete successfully in the global marketplace. In announcing the expansion plans, Mr. Glenn Murphy, director of the Irish Maritime Development Office, said that the Government has created the commercial and financial conditions that have fostered an environment where both foreign and Irish companies can now expand and develop their business.

In the past 15 years the value of trade through Irish ports has grown from €28 billion per annum to €150 billion. Ireland has managed to establish itself among the top 15 international shipping finance centres and, earlier this year, gained admittance to the prestigious white list of top performing shipping states in the world. Obtaining white list status is an international recognition that Ireland operates a quality shipping register. It is against this background of proactive support for the Irish shipping industry that the legislation is founded. It seeks to assist the port authorities in growing and developing maritime businesses in future. For the first time, it seeks to provide a clear legislative basis to underpin investment by port companies outside their current harbour limits. This provision is necessary to facilitate the development and successful completion of proposals relating to investment by port companies outside their limits and outside the State. Special provision will be made to facilitate the proposed new port development at Bremore, County Meath, which has the potential to develop into a major maritime centre on the east coast.

The provision to reduce the number of directors the board of a port company from 12 to eight should improve the ability of commercial ports to deliver on their mandate. I have always believed that a small, tightly focused group of people committed to achieving a common goal can be far more effective than a large cumbersome group with diverse interests. The Minister of State, Deputy Devins, spoke of the rather nonsensical situation where, in some cases, the number of directors on port company boards is greater than the number of employees in the company.

On the role of local authority members on maritime boards, I share the concern expressed by some of my colleagues in the House that there is a gradual erosion of the powers of elected representatives. If we are to argue credibly for enhanced local representation and strengthened local democracy, however, we must acknowledge that there are, perhaps, no roles for certain local authority members on such boards. These are commercial entities operating in a highly pressurised global environment. The port companies at Drogheda, Waterford and Rosslare are not competing with each other but against such ports as Rotterdam and Southampton. If the [339]expertise exists within our local authorities and if there are people who have the knowledge and commercial background to make a serious and worthwhile contribution to the running of these commercial entities, then let them serve on the board. The comments from Senator Cummins of his experience on the board of Waterford Port Company suggest that if he were currently a member of the relevant local authority, he would be an ideal candidate to occupy such a position. However, the suggestion that we should simply adopt people onto the boards of these commercial entities solely because they are members of a local authority is spurious and does not give credibility to the argument that we should have enhanced representation and strengthened local democracy. If we are to make this argument, we should be equally honest and state that there are times when local authority representation is not necessary and could be a hindrance.

We will give autonomy to the port authorities by allowing them greater flexibility to borrow to fund additional port capacity. The Irish Exporters Association has welcomed these aspects of the Bill. In its opinion the legislation will take some of the shackles off port company management and enable it to clear board decisions rapidly and raise the necessary loan finance to invest in new infrastructure which is essential to stay competitive in today’s trading environment.

I commend this Bill to the House as it seeks to provide the autonomy and flexibility that port authorities need to grow. They are an important element of our economy.

Senator Ned O’Sullivan:I am the last speaker in this debate so I will try to pick out some items that have not been so well covered. I welcome the Minister of State, Deputy Devins, to the House. He is such a nice, popular gentleman that I will find it difficult to say to him some of what I have to say about the Bill.

Senator Maurice Cummins:The Senator should go ahead.

Senator Ned O’Sullivan:I acknowledge the presence in the Visitors Gallery of a great friend of ours and a former Deputy, Mr. Eddie Wade, with whom I had the pleasure of serving on the Shannon Foynes Port Company for several years. It is fortuitous that he has arrived during this debate.

The issues most debated appear to be those of rationalisation of boards, mergers, the number of directors and, especially, representation by local authority members. I have mixed opinions about the first matter. Along with Mr. Wade, I was a member of the Shannon Estuary Port Company when the former Limerick Harbour Commissioners and the Foynes Port Company were amalgamated by the then Minister with responsibility for the marine, Deputy Frank Fahey. There was much difficulty with the matter. There was a hard campaign and I was one of those in favour of the merger because I believed the estuary would gain overall from the creation of a single authority. I believed my area in County Kerry would stand to gain from the change. Not everyone agreed with this position. There were teething difficulties with the amalgamation, some of which have been well documented. I lived through the changes and, overall, it was a good example of a merger.

I am not so sanguine about the proposed merger of Shannon Foynes Port Company with Fenit Harbour. This is not at all popular in County Kerry. I was speaking to the chairman of the board, Councillor John Wall, this morning and he explained there was resistance across the board in Fenit and Tralee to the proposal. Fenit’s operation is very different from Shannon Foynes which is a huge, industrialised port. The business of Fenit is almost entirely leisure and tourism-based. It has a niche industry client, Liebherr in Killarney, which, if Fenit was not available, might relocate out of Kerry and the south west altogether. The Minister of State should be cautious in this regard.

[340]Our colleague, Senator Denis O’Donovan, has championed the cause of Bantry in the House and, formerly, in the Dáil. He regrets that he cannot be present but he has outlined, as have other speakers, the way that Bantry has returned a profit through the years, as has Fenit. If something is working and not broken, one does not fix it. A port that is making money should be cherished.

I am a student of history and I am currently reading late 19th century history. An extraordinary coincidence has occurred because at the turn of the 19th century there was much trouble in Bantry and there was a very formidable politician there by the name of Timothy M. Healy. Like Senator O’Donovan, he had a beard and practised as a solicitor. He led a group of politicians which became known as the Bantry gang. They created much difficulty for their leader at that time, Mr. Charles Stewart Parnell, who was an elected representative for County Meath. The Minister for Transport, Deputy Dempsey, should examine closely——

Senator Maurice Cummins:The Senator will have to come up with another one.

Senator Ned O’Sullivan:——this situation before he tackles the Bantry gang.

I have no difficulty with the reduction in the number of board members. Everything is getting leaner and tighter nowadays and this makes some sense. I have two comments on the matter. It is not fair to have only one worker director. In my experience, worker directors made a very important contribution on the board of which I was a member. It is unfair to expect one worker to attend at a board meeting and try to fight a cause on behalf of a large number of employees which, in the case of Shannon Foynes Port Company, for instance, work in a region almost 50 miles in length. We should consider appointing a second worker-director.

4 o’clock

On the contentious issue of councillors on boards, I strongly support the views expressed by Senators on both sides of the House and I am on record about the need to protect the rights of councillors. I was happy to hear the Taoiseach make it clear in the Dáil yesterday, in response to a query, that he has absolute confidence in councillors and should they be suitable for appointment to a board, he is fully in favour of public representatives being appointed to boards. That is from the Taoiseach, a man for whom I have the greatest respect, as does the entire country. I hope all the Ministers will take a leaf out of the Taoiseach’s book in that regard.

I have had words with the Minister, Deputy Dempsey, on this issue and he is aware of my views. Appointments were made recently to the board of Shannon Foynes Port Company with the result that for the first time in nearly 50 years, no Kerry person or public representative has a say in the affairs of the estuary which is closest to us and which is of major importance to our welfare and our future. I served on the board for 15 years. A cousin of mine, the late former Senator and Deputy, Kit Ahern, served for an even longer period. Many other excellent councillors represented the interests of Kerry and of the region but for the first time that has ceased to be the case. I can assure the Minister of State that is resented in Kerry. I hope that when any further appointments are made to the board of Shannon Foynes Port Company, the kingdom will not be left out again.

There are many positive measures in the Bill. It is a proactive Bill that examines ways to increase the profitability and competitiveness of our major ports, and as a former director I applaud that. Many serious issues arose that were creating obstacles to progress and to profit. I agree with the speaker who said that we are driven by profit but obstacles were put in our way to do with the acquisition of property and expediting planning applications. I disagree with the speakers who said that An Bord Pleanála is not the appropriate body to deal with planning issues. We had witness to that in my own north Kerry area recently when we got fast-track [341]planning permission for the proposed gas terminal, which is supported by the community with the exception of one or two individuals. Senator Paul Coghlan, my great friend and colleague, was good enough to mention the fact that I experienced difficulty regarding my position there, along with another colleague and great friend, Councillor John Brassil. A complaint was made about me to the director of the Ethics Register because I was a member of the board of Shannon Foynes Port Company at a time when Kerry County Council — of which I was also a member — rezoned land to provide for that gas terminal in Tarbert-Ballylongford. Councillor Brassil was a chairman of Shannon Development and I was a director of Shannon Foynes Port Company. I am glad to say both of us were exonerated. We had no case to answer. We had no pecuniary interest. I regret to say we do not own any property adjacent to the site. That matter has been put aside.

To return to the original point about the councillors, the Minister would be sending out the wrong signal if he reduced the number of councillors on boards. It might give credence to the people I mentioned earlier, many of whom may be cranks who are trying to find fault with public representatives. Public representatives should be supported by our Ministers.

The various Governments in the past ten years must be commended for major investment in our ports under the national development plan. People often ask if money was wasted during the days of the Celtic tiger but I deny that. The Government handled the wealth very well and I hope and pray it will now be in a position to handle the downturn equally well. When people say to me that money was wasted, I tell them to consider the investment that was made in our major ports such as Waterford, Dublin, Shannon and Galway. That was good use of money. It was investment in our future and future generations will reap the benefit of that investment.

In the tougher times we are now entering there has never been a greater need to focus on the commercial mandate of our ports. This Bill enables that. It will be proven to be positive. I believe most Members will support it, although there are aspects of it on which we are not keen. The suitability of public representatives for membership of the boards will continue to be a hot issue during the debates on the various Stages. I will vote for the Bill as put forward by the Minister but I will work as hard as I can to get some movement on that aspect. I intend to take up the challenge issued to us by Senator Cummins.

I must take umbrage with a colleague whom I respect, Senator Boyle, who said that if people in councils had the proper skills they should be appointed to boards. In other words, if a member of a council happens to be an expert in maritime affairs or hydrology, he or she is suitable to be appointed to a harbour board. However, councillors themselves are a skill set, to use his term. To be a councillor one must first be elected, which takes a fair amount of skill. One must be local, which is very important when it comes to regional boards. Also, one must have a commitment to the welfare of the community, not for oneself or one’s pocket but for the overall good. All those experiences create a skill set which Senator Boyle would agree a councillor encompasses.

I commend the Minister and compliment his officials. I have dealt with officials in the Minister’s Department at different levels for many years and always found them to be proactive and concerned with the good of the harbours and of the country.

Senator Cecilia Keaveney:I am pleased to speak for a few minutes on this important topic. As an island nation we do not have a sufficient number of debates on marine issues. It is disappointing that Members are not queuing up to talk about them, as we do in regard to many other topics, and use the facility of Second Stage to not only address the Bill but introduce other issues. I welcome the Minister of State, Deputy Devins, to the House.

[342]Having said that, the first point I would make in a debate on marine matters is that politicians, never mind those involved in the marine industry, have a difficult life in that the marine is under the aegis of seven Ministers and Ministers of State. When pursuing particular issues one finds that harbours come under the aegis of one Minister, inland rivers come under the aegis of another while another Minister has responsibility for the seas. It is difficult to follow particular projects when there are so many people responsible for the area of the marine.

On the Bill before the House, I was interested to hear the various topics raised in the debate to do with west Cork, Kerry and Waterford. It seemed to be one of those debates on the region south of the line from Dublin to Galway but I must ask what is in it for me? I do not ask that in a personal sense but as a representative from Donegal. What is in the Bill that will reflect the fact that we are surrounded by water? I live in a peninsula and the Londonderry Port and Harbour Commissioners is the nearest recognised port authority to me. I live close to the mouth of the Foyle where many of the big boats that come in every day to go to Londonderry Port and Harbour Commissioners at Lisahally must spend one, two or three days waiting for the right tide to allow them do that. They often do not get the right tide and must wait for smaller boats to come down and unload them in the middle of the Foyle.

What do we intend to do to develop the new port authorities? Are we happy to leave things the way they are currently? Are we proactive in terms of developing our marine activity? On the number of boats coming in to the Foyle, the vast majority, approximately 90%, leave empty. What are we doing to promote the idea in my region of not only importing but exporting? That is the reason I raise the issue of ministerial responsibility. This relates to the whole issue of recognising our waters as an economic resource. I refer to commercial freight, luxury cruise liners, international and local yachting opportunities, local rowing clubs and the ongoing fishing activities. One cannot speak about a port without considering all the activities that go on there. Greencastle Harbour is the host port of the pilot boat, the Greencastle car ferry to Magilligan and the local white fish fleet. Many oyster and mussel farmers are based there. There is a coastguard in Greencastle, as well as a search and rescue service. Some yachts are moored there at the moment, as a consequence of mooring difficulties elsewhere. I wish to declare an interest in this regard — I row into Greencastle Harbour during my ventures between Moville and Greencastle on the odd Sunday. The Foyle punts also use the harbour. There is a great deal of activity there.

I was interested to hear Senators speaking about the concept of a port authority extending its reach to another area. It was suggested that people in County Donegal might link up with people in the North to make their economic entity more realistic. Like Senator Ellis, I would like to know whether anything is being done at cross-Border level. Is the port authority in Derry working with its counterpart in Donegal to ensure that the potential of Greencastle Harbour, or Carrickarory pier in Moville, is developed? A small addition to the existing pier at Carrickarory would provide access to natural deep-water berthage, thereby enabling many ships that cannot travel up the Foyle to offload at that point.

Senator Boyle suggested that railway stations are necessary at our ports. I do not mind if he wants to develop a railway line between Derry and Moville. I suppose it might have happened in the past. There does not seem to be much potential for it at the moment. Some €36 million is being invested in Greencastle Harbour. A breakwater is being developed and safer facilities are being provided to benefit those who use the harbour. It is a matter for the local authority.

It is great that we are giving local authorities responsibility for looking after our ports. If we give them responsibility for the less economically viable harbours, however, they will not have the same money-generating opportunities. Perhaps I do not understand the system correctly. [343] The harbours to which I refer have the same maintenance costs. They will have to ask the Department of the marine for money to upgrade or maintain slipways. The slipway in Moville is in serious trouble. There will be problems when it comes to getting co-financing from the local authority. We are giving the local authority more and more responsibility, while expecting it to provide 25% co-financing. It is wrong to suggest that this Bill does not have any financial implications. It will have financial implications for the local authorities which will be given responsibility for additional harbours. I know that from my first-hand experience of Greencastle Harbour. We had a serious battle when we tried to get Donegal County Council to provide 25% of the €36 million the harbour needed. Thankfully, the Minister for Community, Rural and Gaeltacht Affairs, Deputy Ó Cuív, came partly to the rescue in that regard.

I wish to speak about public representation on boards. I believe that many public representatives have as much knowledge of, and interest in, these matters as anybody else. We are more accountable then anyone else because we can be kicked out at each election. I accept that people sometimes agree to sit on certain committees because it is the done thing. When I was a member of a local authority, I did not get involved in things unless I was interested in them. I lost money because the amount of time I put into some meetings could not be matched by the amount of recompense that was available in those days for travelling to them. I urge the Government to move slowly when considering whether to abolish public representation on boards of this nature. I agree with those who said it would be fair enough if the reduction in public representation on boards were proportionate to the reduction in the overall size of boards. We should not exclude public representatives altogether.

I would very much like to see a single overall marine ministry established again. Equally, the remit of our ports should not be explicitly commercial. They should have a commercial perspective, but they should also be concerned with ferries, cruises and leisure and recreation. A great deal of opportunity is being missed. Ireland is an island nation. One can count on one hand the number of people who use the seas and waterways in most parts of the country. To date, we have not taken advantage of the opportunity provided to us.

A Member of the House asked whether the involvement of An Bord Pleanála in some aspects of this sector will speed things up or slow things down. I have been trying for many years to secure permission for the development of a breakwater in Buncrana, for the exclusive benefit of the RNLI. If the breakwater is used for other purposes after it is put in place, the lease will have to be renegotiated and changed. The delay in taking action in that regard is scandalous. I remind whoever is responsible for bringing projects of this nature to a conclusion that this project is very important.

I am interested in the concept of healthy competition. As I said at the outset, the potential of harbours in my local area like Greencastle, Moville and Buncrana to do more than they are doing at present is being stymied. The harbours in question are on Lough Foyle and Lough Swilly. The Londonderry Port and Harbour Commissioners have some responsibilities in respect of Lough Foyle. It seems that ne’er the twain shall meet. I would like this opportunity to be taken so that County Donegal can gain from the potential that exists.

Senator Lisa McDonald:I welcome the broad thrust of this Bill. The ten port authorities it covers are currently covered by the Harbours Acts. The years to come will represent an important era for the harbours in question. They will get investment. They will be able to go outside their functioning area to acquire assets, etc. That is all to be welcomed. I am wary of the proposal to give further powers to An Bord Pleanála. I do not believe the general public has much confidence in the proposal. Those who have had dealings with An Bord Pleanála on planning permissions, etc., associate the organisation with a lack of transparency and accountability. I do not understand why local authorities are not being given the power to compulsorily [344]acquire land where relevant, possible or necessary. As Senator Keaveney said, local representatives often have more knowledge of these matters. It is generally the case that local authorities are used to working in the areas in question. It is a new departure to give An Bord Pleanála more powers, in this day and age. I would not be keen to undermine local authorities any more than they have already been undermined. Many people, on foot of their own experiences, are not impressed by the proposal to give An Bord Pleanála further clout.

As a native of Wexford town, I am a little upset about one aspect of the Bill. The three most important ports in County Wexford are Rosslare Europort, Kilmore Quay and the old harbour in Wexford town. Their importance differs as they have differing functions and levels of activity — they are not in competition with each other. It is astonishing that Rosslare Europort is not mentioned in this legislation, and has scarcely been mentioned during this debate, given that it is the nearest Irish port to the UK and mainland Europe. Perhaps the Minister of State intends to introduce a separate Bill to provide for Rosslare Europort. I would welcome such legislation because it is needed. As someone who often travels to Rosslare, I can inform the House that ships often have to wait at sea before they can berth because passengers are disembarking from another ship at the port. It badly needs investment and this Bill does not provide for Rosslare Europort. I am very upset about that.

One Senator said Waterford had the most important port in the south east, but I think Waterford and Rosslare have completely different functions. Rosslare is ro-ro whereas Waterford is more freight orientated. In that respect they do not need to be mutually exclusive. I appreciate it is run by CIE and a separate Bill may be required, but I do not want the opportunity to pass without mentioning it.

Kilmore Quay is the most important fishing port on the south-east coast and one would need to go as far as Castletownbere to find a port that is as busy. The fishing industry there has gone through its worst ever turmoil in the past five years. Senator Keaveney called for more pressure to be placed on local authorities to provide investment. It is very difficult and we need to look at the area of investment. There are people in Wexford who do not have berths for their leisure craft. New marinas could be provided at the smaller piers that are no longer in action.

I notice that three ports — Fenit, Tralee and Bantry — have been given flexibility to transfer to local authority control or to have their own port company because of their commercial activity. Every year, €15 million worth of mussels are harvested in Wexford Harbour and one can go anywhere in Europe and find Wexford mussels on the menus of hotels and restaurants. Wexford Port, which used to be so important to this economy in years gone by, is still an active, working port and should have been included in that list. I have spoken to the county manager about this and the council has concerns that it will not be able to provide the investment required for this working port. Small things like slipways, buoys in the harbour and so on are all issues of concern to the local authorities in respect of this matter. They need some clarification. Perhaps it has been given and I am not aware of it. I know the harbour commissioners in Wexford made the case to the Department for inclusion but it has not been included. I wonder whether anything will be done about it.

We are all aware Wexford hosts the international opera festival, which is coming up shortly. The marina in Wexford is a fabulous vantage point for Ireland from a tourist perspective. It is very important the situation is not reached with the harbour where the level of investment required will not be provided. I generally welcome the Bill, including the investment for the ports that are covered in it, but I am concerned about the ports that are not covered.

[345]Minister of State at the Department of Enterprise, Trade and Employment (Deputy Jimmy Devins):I thank those Senators who contributed to the debate for the constructive manner in which they have approached the Second Stage of this Bill. We all realise the critical importance of the State’s commercial ports to our economy and the vital role they play in facilitating growth and prosperity. The Minister of State outlined to the House his belief that this Bill will further enhance the commercial ethos conferred on our ports by the Harbours Act 1996 and will ensure they are positioned to respond to the challenges they will face.

Senator Ellis raised the issue of borrowing and asked who decides the value of the port assets. This is obviously an important issue. Fixed assets valuations are set out in the port company’s audited accounts. Senator Ellis also raised the issue of port tariffs. They are set out by individual port companies and are an operational matter for the port companies under the Harbours Act 1996. Senators Ellis and Keaveney referred to co-operation with the Northern authorities. The all-island nature of the ports sector is well recognised by the Department, and there is close co-operation between the Department of Transport and the Department for regional development in Northern Ireland.

Senators Cummins, Ellis, Burke and others referred to the role of An Bord Pleanála and the compulsory purchase order powers conferred on it. The Bill transfers the Minister’s powers to An Bord Pleanála but it does not confer any additional powers. Since 1996, only one such order has been made.

Several Senators referred to the issue of removing local authority representation from port company boards. The statutory performance audit of port companies in 2001 and the 2003 high level review of State commercial ports both concluded that the practice of statutory local authority representation on port company boards should cease. Local authorities do not nominate directors to the boards of other commercial State companies such as airports. There is a view that the presence of local authority representations may create the potential for conflict of interest. This could constrain the boards from pursuing tough commercial decisions and strategies.

Senator Maurice Cummins:That did not come from the Minister of State. That is coming from some civil servant.

Senator Ned O’Sullivan:I am afraid so.

Senator John Ellis:The Minister of State is providing the Civil Service line. It is time civil servants realised that although they are the permanent government, they are not facing the electorate.

Deputy Jimmy Devins:While the policy statement of the ports was published in January 2005 envisaging the reduction of local authority representation from three members to one, we felt it was necessary to remove local authority representation by right in order for the port companies to be seen to operate on a fully commercial basis. I have no doubt this issue will surface on Committee Stage.

Senator McCarthy spoke about the reduction of employee representation on port company boards. Two employee directors may be elected to the board, which is currently the case in just three of the ten companies, namely, Dublin, Cork and Shannon Foynes.

Senator Cummins and Senator Keaveney raised the possibility of the Bill providing for future amalgamation of port companies. While the Bill does not provide for any initiatives in this regard, it is evident that existing legislation provides enabling powers for amalgamation of port companies should that course of action be identified as the most appropriate for the companies in question.

[346]A few Senators spoke about the transfer of Bantry Bay and Tralee and Fenit harbour commissioners to port company control. It is an issue that will be raised again on Committee Stage, but the Bill will allow for three potential courses of action for these harbours. There will either be a transfer of control to the relevant local authority, the establishment of a private company in respect of the harbour, or a transfer of control of the harbour to the relevant port authority.

With regard to the compulsory purchase order provisions that were mentioned, ministerial functions under the Fourth Schedule have been exercised only once since the enactment of the 1996 Act. It is worth stating that An Bord Pleanála has, pursuant to the Planning and Development (Strategic Infrastructure) Act 2006, become the determining body in respect of planning consent for strategic infrastructure developments at the commercial ports. It would make sense, therefore, that it also would become the determining body regarding the adjudication of applications for the compulsory acquisition of property as described already in the Bill.

Senators Keaveney, Boyle and others made reference to the fact that the port companies should be looked at in the context of an overall freight transport policy for the whole island of Ireland. It is worth stating that a port capacity study was carried out in 2006 which received detailed submissions from seven ports in regard to increasing utilised capacity. Iarnród Éireann has undertaken extensive engagement with the industry and port authorities but has had genuine difficulty in identifying business opportunities that offer reasonable volumes of business which could be utilised on a regular basis.

Substantial ongoing current and capital Exchequer investment is being made in the development and operation of the railway network as one of the measures to encourage rail freight business. In addition, rail freight has been fully liberalised since 1 January 2007. While no serious representations have been made to date to the Department of Transport by private rail operators for entry into the market, the Minister would welcome any expressions of interest in this regard.

Senators raised other issues in their contributions but I have endeavoured to cover them as best I can. I thank Senators for their contributions and look forward to Committee Stage when many of the issues raised will be discussed further.

Question put and agreed to.

Acting Chairman (Senator Paul Bradford):When is it proposed to take Committee Stage?